On July $1,2021,$ Davis Corp. issued $ $800,000$ par value, $10\%,10-$year bonds, with interest payable semi$-$annually on January $1$ and July $1.$ The bonds were issued for $ $908,722.$ Late $2022,$ Davis offered to buy back the bonds at $103.$ On Jan $2,2023,$ forty percent of the bondholders accepted the offer. At this time the accrued interest was paid to the bondholders whose bonds were being extinguished. Davis follows IFRS and uses the effective$-$interest method of amortizing premium or discount. $($Hint: you will need to determine the effective interest rate for the bond$).$

$4\%$

Instructions

a$)$ Prepare the journal entry to record the bond issuance.

b$)$ Prepare the adjusting entry at December $31,2021,$ the end of the fiscal year.

c$)$ Prepare the entry for the interest payment on January $1,2022.$

d$)$ Prepare the entry to record the payment of interest and the retirement of the bonds on June $2,2023.$

Round all values to the nearest dollar.